Knowing when not to take on a listing is as important a skill as any other in this game. The question is how is that decision made? Tony Rowe gives his opinion.
There has been lots of talk recently about agents lowering their fees to secure listings, sometimes to ridiculous levels. Yes, it’s competitive out there. Yes, getting the maximum number of listings you can is important; but you also need to look at the level of revenue or profitability that each listing will potentially bring. The thrill of the chase is what we all live for, and winning the prize of another listing will make the raw numbers look good, but you should also be prepared, on occasions, to just walk away.
When should you walk away? Here are some questions I believe that could be asked when deciding to accept a property listing, or not, and if you can’t answer these to your own (and your Principal’s satisfaction) then it might be time to consider moving on.
- Are you sure of what you’re actually offering to the vendor?
- Does that match vendor requirements for the sale of the property?
- Are you sure of what you’re not offering to do to sell the vendor’s property?
- Have you got all the information from the vendor you need to make an informed decision?
- Have you asked all the questions that need to be asked about the property and sale?
- Does your gut tell you this is going to be a problem listing?
If you do decide to proceed, it should be with full enthusiasm for the sale and to manage anything that comes your way with the sale negotiations. A half-hearted effort will only bring grief, so the message is ‘choose carefully’!
If an agent was to go to a listing unprepared, might as well not go (but shouldn’t whine about the outcome if someone else secures the listing ahead of them)!Listings generate your money, via the sale of the listed property. Without listings, there is no sale. Without sales, there is no money. If it is to be money to the agent and the agency, the bulk of the hard work should be done before the marketing begins – in getting the listing in the first place.So, preparation is key. Be prepared! Know what you will and won’t accept!
The listing presentation is where it is competitive with the other agents, but it is where the skill of the agent comes to the fore as a negotiator and demonstrator of their skill to showcase the agency, and their capacity to get the best result possible for the vendor. The discussions at the listing presentation provide the information that will allow the agent to make the call on whether the vendor is a dream or a nightmare to work with. You don’t need nightmare clients – leave them to the competition!
What do vendors actually think when you are willing to drop your fees? If it were me, I’d be wondering “if he/she drops his/her fees so easily, how will he/she go when an offer is presented that is below what I believe my property is worth?” In other words, if an agent is desperate enough to lower their fees in order to secure a listing, then that agent will also be likely to lower the selling price too. There is no doubt that will eventually come back to bite in some way.
Learn to justify your fees, promote the services of the agency, and secure vendor paid advertising. If you feel uncomfortable doing these three things, then you need to learn how to, and quickly. Principals, this is your responsibility – your team needs to be coached or mentored until they have mastered this art.
A beneficial outcome for the vendor needs to be clearly stated, but so do the obligations, costs, and timelines. If the vendor is not prepared to be a willing partner to the plan, this is a pretty clear indication that a problematic relationship is going to exist. A good relationship for both parties requires both the agent and vendor to work together, to achieve a win-win outcome.
If that isn’t the case, “Just walk away”!